Neonatology Associates, P.A., et al - Page 24




                                               - 24 -                                                  
            plan administrator, allowed Mr. Mall to join the plan, and they                            
            made him eligible to receive a death benefit in an amount                                  
            commensurate with the death benefit payable under other life                               
            insurance that he had owned outside the plan.  Dr. Mall falsified                          
            and backdated documents in an attempt to legitimize Mr. Mall’s                             
            participation in the Neonatology Plan and to attempt to                                    
            legitimize the plan with various governmental agencies and                                 
            regulatory bodies.                                                                         
                  The Neonatology Plan’s adoption agreement provides that all                          
            employees covered by the plan will receive a death benefit equal                           
            to 6.5 times his or her prior-year “compensation” (defined by the                          
            plan to exclude nontaxable fringe benefit items).  Neonatology                             
            paid Dr. Mall compensation of $240,000, $250,000, and $168,000                             
            during 1991, 1992, and 1993, respectively.  Neonatology did not                            
            pay Mr. Mall any compensation during those years.                                          
                  Neonatology contributed to the Neonatology Plan during each                          
            year from 1991 through 1993 and, for each subject year, claimed a                          
            deduction for those contributions and other related amounts.  In                           
            1991, Neonatology contributed $10,000 to the plan on behalf of                             
            Dr. Mall.  It also paid the plan’s trustee and its administrator                           
            $1,000 each.  In 1992, Neonatology contributed $10,000 to the                              
            plan on behalf of Dr. Mall and $10,000 on behalf of Mr. Mall.  It                          
            deducted the $20,000 on its 1992 Federal corporate income tax                              
            return as an employee benefit program expense, and it deducted on                          






Page:  Previous  14  15  16  17  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  33  Next

Last modified: May 25, 2011